TOKYO (AP) – Japanese technology company SoftBank Group posted a USD23.4 billion loss in the April-June quarter as the value of its investments sank amid global worries about inflation and interest rates.
SoftBank Group Corp’s loss of JPY3.16 trillion was a reversal from its JPY762 billion profit in the same quarter a year earlier. Quarterly sales rose six per cent to JPY1.57 trillion.
“I must humbly acknowledge that things are really bad,” a somber Chief Executive Masayoshi Son told reporters yesterday. “I must face up to this.”
Losses for the last six months totalled about JPY5 trillion, and the latest red ink was the worst quarterly loss since the company’s founding, he said.
For the fiscal year that ended in March, SoftBank racked up losses of JPY1.7 trillion, a reversal from the JPY4.9 trillion profit for the previous year. Annual sales grew 10.5 per cent to JPY6.2 trillion.
Although SoftBank’s portfolio is not directly exposed to the war in Ukraine, the company warned that global uncertainty as well as inflation and soaring energy costs would likely hurt its profitability.
Much of the dip of the value in shares came from a drop in price of Chinese e-commerce giant Alibaba, in which SoftBank is a major investor. The declining value of the yen also hurt Tokyo-based SoftBank’s bottom line because its borrowings must be repaid in yen.
How long the problems will persist is unclear, Son said, noting it could be months or even years because of global instability and inflation.
SoftBank’s intended sale of British semiconductor and software design company Arm to Nvidia failed earlier this year. SoftBank is now promising lucrative future growth at Arm, including an initial public offering, although a date has not been announced for that offering.